Embrace New Processes to Ensure Technology Implementations are Successful

Most transformation projects fail entirely, or at least fail to deliver promised results. Many small financial institutions use technology to transform business operations in the pursuit of efficiencies and other competitive gains within their industries. Many of these efforts fail to achieve their strategic objectives. These well-intentioned efforts often suffer significant cost overruns and scheduling delays which erode the initial value proposition. The traditional response is to drive more rigorous management routines and delay or cancel the project. In many cases, management fails to understand the underlying issue impacting performance.

New technology means changing old processes. Existing financial institutions have numerous legacy processes performed by employees. These processes were created to allow efficient processing based upon the regulatory environment, financial, and staffing constraints in the market. Technology is deployed in many cases to fundamentally change or automate these processes and create efficiencies.

Understand that digital also transforms the bank’s ability to optimize liquidity, pricing, and balance sheet management. With online account opening, any bank has the opportunity to grow deposits by posting a competitive rate. Increasingly prioritizing convenience over price, digital depositors will often stick with a bank even if rates drop at rollover. Digital platforms are also highly effective at capturing money in motion during a market event. Online account opening is a highly effective way to build a core deposit franchise and support growth without use of brokered deposits. Finally, consumer platforms are well ahead of commercial, but commercial is rapidly evolving.

To successfully implement new technology, fully embrace the change that comes with it. New platforms and specialized solutions are being introduced by the fintech industry that provide the opportunity to introduce a high level of automation. These offerings provide an opportunity to transform a business unit or the entire bank. For these efforts to be successful, the new capabilities need to fully deployed and new processes widely adopted. This will likely mean significant change throughout the many functions in the bank, and often a rewrite of the bank policies that govern these activities.

Don’t force the new to work and look like the old. One of the most common issues we see impacting the deployment of these new systems is companies forcing the new capabilities to look and operate like the platforms and processes they are replacing. Employees comfortable with current processes are routinely charged with rolling out the new platforms. Routinely the team expends significant effort attempting to customize the new platforms to look and feel like the old platform, or make the new processes and reports fit into the old processes and reports.

Constantly challenge teams to fully adopt change; ensure success with training and robust communication. Companies that want to drive the adoption of new platforms to change their operations must be willing to constantly challenge their teams to fully adopt new systems and tools. Management should constantly question customizations to ensure they are maximizing the value of the technology they are acquiring. This will likely require an investment in training on the new platform and ample communication to ensure employees clearly understand the transformation plan and why management is making the change.

Customization drives up cost, increases complexity, and decreases the likelihood of success. An example we typically see is the creation of custom workflows and report rewrites. In this case, a desire to improve adoption raises deployment costs, and in many cases, replaces out-of-the- box functionality with custom development. This development needs to be maintained for the life of the new product and drives up short-term complexity and long-term run costs.

Understand the change behind your new technology. To be successful, financial institutions need to understand the objectives behind the new technologies in the context of the process changes it brings. In many situations, this calls for the introduction of an outside perspective. Whether the outside perspective comes from a team outside the group introducing the new capabilities or someone from outside the company, this perspective is critical.

Employees like stability and often resist change. The introduction of new technology requires change to take advantage of the new capabilities provided. Training on the new technology and communication of the business imperatives are critical. Providing an outside perspective to question the need for custom development and leverage best practices in implementation can speed time to business transformation. Digital banking initiatives should not join your failed project graveyard! In some cases, deploying a platform with the minimal functionality for employees may be necessary. Back-office changes can often be more effective after employees have experience with the platform.

Why Endurance Advisory Can Help

If any of this sounds daunting or perhaps confusing – reach out to our team. We can help demystify the process and help your institution refine your plan and make key decisions. The simplest of questions is where we start. We are here to provide resources and support where your team’s bandwidth is limited or knowledge is stretched.

Successful digital marketing is a must. Have the strategies, target markets and personas, messages, and tools in place and vetted by compliance well before launch. Effective marketing campaigns are critical to driving clients to a bank’s digital on-ramps. At fully digital banks, marketing is 40% of operating expenses. Allocate sufficient resources to be successful; don’t starve the marketing budget. Start small and test different approaches. Fine-tune tactics before spending significant funds.

Our firm, Endurance Advisory Partners, was founded in 2009, and is focused on the financial services sector. Our teams are led by advisors with deep banking experience across a variety of areas. Please visit our website at https://enduranceadvisory.com/ - we have details on our practice and white papers on a variety of topics.

Endurance has a talented IT and Digital Marketing team that knows what it takes to have a successful implementation. We have led many successful core conversions and technology transformations, both as consultants and as banking leaders, and have been providing digital marketing support to large and small clients. Our firm has partnered with specialist firms and banking associations to bring these services to the community banking industry.

We look forward to working with you to ensure a successful Digital launch!


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